New York, Sep 26 (AP) Shares of some big drugmakers rose Friday as Wall Street started sorting out the impact of President Donald Trump's latest tariff announcement.

The president said late Thursday that he would place 100 per cent import taxes on pharmaceuticals starting October 1, but those tariffs would not apply to companies building US manufacturing plants. He defined that as either “breaking ground” or being “under construction.” Several big drugmakers like Merck & Co. Inc., Eli Lilly and Co. and Johnson & Johnson have announced US expansion plans.

Trump has talked about pharmaceutical tariffs for months, but he has said he would delay them for a year or a year and a half to give companies time to stockpile medicines here and shift manufacturing.

Analysts have said companies started stockpiling medicines in the US earlier this year.

Jefferies analyst Akash Tewari said in a research note that Thursday's announcement shouldn't have a material impact on the big drugmakers, given their construction plans.

But David Risinger of Leerink Partners noted separately that smaller companies may be vulnerable to the new taxes, although he said it was hard to predict which ones.

He said several questions remain unanswered. Those include whether the action will survive legal challenges and how the phrases “breaking ground” and “under construction” are defined for tariff enforcement.

Risinger also questioned whether the new taxes might be a negotiating tactic tied to an investigation the administration launched in the spring over how importing drugs and their ingredients affects national security.

Shares of Merck and Lilly both climbed more than 1 per cent before markets opened, while J&J's stock rose slightly. (AP) GRS GRS

Pharmaceutical import tariffs tied to U.S. manufacturing status shift trade exposure and raise definitional and legal risk questions. The presidential announcement imposes pharmaceutical import tariffs while exempting companies that are 'breaking ground' or 'under construction' on U.S. manufacturing facilities, creating an enforcement focus on how those phrases are defined and raising legal challenge and compliance risks.